Question 1

These individuals follow a firm,conduct their own evaluations of the company's business activities,and report to the investment community.

Accepted Answer

A)  auditors 
B)  investment analysts 
C)  investment bankers 
D)  credit analysts 
A)  auditors 
B)  investment analysts 
C)  investment bankers 
D)  credit analysts

Question 2

Corporate stakeholders include all of the following EXCEPT

Accepted Answer

A)  employees. 
B)  shareholders. 
C)  suppliers. 
D)  auditors. 
A)  employees. 
B)  shareholders. 
C)  suppliers. 
D)  auditors.

Question 3

Not all cash a company generates will be returned to the investors.Which of the following will NOT reduce the amount of capital returned to the investors?

Accepted Answer

A)  retained earnings 
B)  taxes 
C)  dividends 
A)  retained earnings 
B)  taxes 
C)  dividends

Question 4

The agency relationship in corporate finance occurs

Accepted Answer

A)  when the shareholders hire a manager to run their company. 
B)  when the corporate hires an advertising agency to market their new product or service. 
C)  when the board of directors are elected to staggered terms. 
D)  when the board of directors oversee the CEO. 
A)  when the shareholders hire a manager to run their company. 
B)  when the corporate hires an advertising agency to market their new product or service. 
C)  when the board of directors are elected to staggered terms. 
D)  when the board of directors oversee the CEO.

Question 5

Which of the following statements is correct?

Accepted Answer

A)  Sole proprietorships are easy to start. 
B)  If the sole proprietorship gets sued, the owner is not liable. 
C)  It is relatively easy for sole proprietorships to raise money. 
D)  Profits from the sole proprietorship are subject to double taxation. 
A)  Sole proprietorships are easy to start. 
B)  If the sole proprietorship gets sued, the owner is not liable. 
C)  It is relatively easy for sole proprietorships to raise money. 
D)  Profits from the sole proprietorship are subject to double taxation.

Question 6

Which of the following can use financial concepts to improve their decisions?

Accepted Answer

A)  financial professionals only 
B)  financial and nonfinance professionals 
C)  day-to-day operations managers only 
D)  long-term operations managers only 
A)  financial professionals only 
B)  financial and nonfinance professionals 
C)  day-to-day operations managers only 
D)  long-term operations managers only

Question 7

Individuals who provide small amounts of capital and expert business advice to small firms in exchange for an ownership stake in the firm are referred to as

Accepted Answer

A)  institutional investors. 
B)  corporate investors. 
C)  angel investors. 
D)  capital investors. 
A)  institutional investors. 
B)  corporate investors. 
C)  angel investors. 
D)  capital investors.

Question 8

From the perspective of ownership risk,the best form of business organization is the

Accepted Answer

A)  sole proprietorship. 
B)  corporation. 
C)  partnership. 
D)  S corporation. 
A)  sole proprietorship. 
B)  corporation. 
C)  partnership. 
D)  S corporation.

Question 9

This subarea of finance looks at firm decisions in acquiring and utilizing cash received from investors or from retained earnings.

Accepted Answer

A)  investments 
B)  financial management 
C)  treasury management 
A)  investments 
B)  financial management 
C)  treasury management

Question 10

This subarea of finance involves methods and techniques to make appropriate decisions about what kinds of securities to own,which firms' securities to buy,and how to be paid back in the form that the investor wishes.

Accepted Answer

A)  real markets 
B)  investments 
C)  financial management 
A)  real markets 
B)  investments 
C)  financial management

Question 11

A potential future negative impact to value and/or cash flows is often discussed in terms of probability of loss and the expected magnitude of the loss.This is called

Accepted Answer

A)  options. 
B)  standard deviation. 
C)  coefficient of variation. 
D)  risk. 
A)  options. 
B)  standard deviation. 
C)  coefficient of variation. 
D)  risk.

Question 12

Which of the following is defined as a group of securities that exhibit similar characteristics,behave similarly in the marketplace,and are subject to the same laws and regulations?

Accepted Answer

A)  investments 
B)  asset classes 
C)  market instruments 
D)  financial markets 
A)  investments 
B)  asset classes 
C)  market instruments 
D)  financial markets

Question 13

This is a general term for securities like stocks,bonds,and other assets that represent ownership in a cash flow.

Accepted Answer

A)  investment 
B)  financial asset 
C)  real asset 
D)  financial markets 
A)  investment 
B)  financial asset 
C)  real asset 
D)  financial markets

Question 14

Which of the following can create ethical dilemmas between corporate managers and stockholders?

Accepted Answer

A)  agency relationship 
B)  auditors 
C)  boards of directors 
D)  venture capitalist 
A)  agency relationship 
B)  auditors 
C)  boards of directors 
D)  venture capitalist

Question 15

This type of business organization is relatively easy to start,and it is subject to much lighter regulatory and paperwork burden than other business forms.

Accepted Answer

A)  sole proprietorship 
B)  partnership 
C)  corporation 
D)  hybrid organization 
A)  sole proprietorship 
B)  partnership 
C)  corporation 
D)  hybrid organization

Question 16

From a taxation perspective,the form of business organization with the highest business level taxes is the

Accepted Answer

A)  sole proprietorship. 
B)  corporation. 
C)  partnership. 
D)  S corporation. 
A)  sole proprietorship. 
B)  corporation. 
C)  partnership. 
D)  S corporation.

Question 17

These individuals help firms access capital markets and advise managers about how to interact with those capital markets.

Accepted Answer

A)  auditors 
B)  investment analysts 
C)  investment bankers 
D)  credit analysts 
A)  auditors 
B)  investment analysts 
C)  investment bankers 
D)  credit analysts

Question 18

The portion of a company's profits that are kept by the company rather than distributed to the stockholders as cash dividends is referred to as

Accepted Answer

A)  restricted earnings. 
B)  venture capital. 
C)  retained earnings. 
D)  institutional investment. 
A)  restricted earnings. 
B)  venture capital. 
C)  retained earnings. 
D)  institutional investment.

Question 19

An employee stock option plan is

Accepted Answer

A)  a perk usually only given to the board of directors as compensation. 
B)  a plan that only partnerships can use to defer compensation to partners. 
C)  a way to align the interests of employees with those of the owners. 
A)  a perk usually only given to the board of directors as compensation. 
B)  a plan that only partnerships can use to defer compensation to partners. 
C)  a way to align the interests of employees with those of the owners.

Question 20

Which of the following do not ensure firm viability over the long run?

Accepted Answer

A)  maximizing employment 
B)  market share 
C)  profits 
D)  all of these choices are correct. 
A)  maximizing employment 
B)  market share 
C)  profits 
D)  all of these choices are correct.

These individuals follow a firm,conduct their own evaluations of the company's business activities,and report to the investment community.

Corporate stakeholders include all of the following EXCEPT

Not all cash a company generates will be returned to the investors.Which of the following will NOT reduce the amount of capital returned to the investors?

The agency relationship in corporate finance occurs

Which of the following statements is correct?

Which of the following can use financial concepts to improve their decisions?

Individuals who provide small amounts of capital and expert business advice to small firms in exchange for an ownership stake in the firm are referred to as

From the perspective of ownership risk,the best form of business organization is the

This subarea of finance looks at firm decisions in acquiring and utilizing cash received from investors or from retained earnings.

This subarea of finance involves methods and techniques to make appropriate decisions about what kinds of securities to own,which firms' securities to buy,and how to be paid back in the form that the investor wishes.

A potential future negative impact to value and/or cash flows is often discussed in terms of probability of loss and the expected magnitude of the loss.This is called

Which of the following is defined as a group of securities that exhibit similar characteristics,behave similarly in the marketplace,and are subject to the same laws and regulations?

This is a general term for securities like stocks,bonds,and other assets that represent ownership in a cash flow.

Which of the following can create ethical dilemmas between corporate managers and stockholders?

This type of business organization is relatively easy to start,and it is subject to much lighter regulatory and paperwork burden than other business forms.

From a taxation perspective,the form of business organization with the highest business level taxes is the

These individuals help firms access capital markets and advise managers about how to interact with those capital markets.

The portion of a company's profits that are kept by the company rather than distributed to the stockholders as cash dividends is referred to as

An employee stock option plan is

Which of the following do not ensure firm viability over the long run?

Reviewing Financial Statements

Analyzing Financial Statements

Time Value of Money 1: Analyzing Single Cash Flows

Time Value of Money 2: Analyzing Annuity Cash Flows

Understanding Financial Markets and Institutions

Valuing Bonds

Valuing Stocks

Characterizing Risk and Return

Estimating Risk and Return

Calculating the Cost of Capital

Estimating Cash Flows on Capital Budgeting Projects

Weighing Net Present Value and Other Capital Budgeting Criteria

Working Capital Management and Policies

Filters

Exam 1: Introduction to Financial Management

These individuals follow a firm,conduct their own evaluations of the company's business activities,and report to the investment community.

Corporate stakeholders include all of the following EXCEPT

Not all cash a company generates will be returned to the investors.Which of the following will NOT reduce the amount of capital returned to the investors?

The agency relationship in corporate finance occurs

Which of the following statements is correct?

Which of the following can use financial concepts to improve their decisions?

Individuals who provide small amounts of capital and expert business advice to small firms in exchange for an ownership stake in the firm are referred to as

From the perspective of ownership risk,the best form of business organization is the

This subarea of finance looks at firm decisions in acquiring and utilizing cash received from investors or from retained earnings.

This subarea of finance involves methods and techniques to make appropriate decisions about what kinds of securities to own,which firms' securities to buy,and how to be paid back in the form that the investor wishes.

A potential future negative impact to value and/or cash flows is often discussed in terms of probability of loss and the expected magnitude of the loss.This is called

Which of the following is defined as a group of securities that exhibit similar characteristics,behave similarly in the marketplace,and are subject to the same laws and regulations?

This is a general term for securities like stocks,bonds,and other assets that represent ownership in a cash flow.

Which of the following can create ethical dilemmas between corporate managers and stockholders?

This type of business organization is relatively easy to start,and it is subject to much lighter regulatory and paperwork burden than other business forms.

From a taxation perspective,the form of business organization with the highest business level taxes is the

These individuals help firms access capital markets and advise managers about how to interact with those capital markets.

The portion of a company's profits that are kept by the company rather than distributed to the stockholders as cash dividends is referred to as

An employee stock option plan is

Which of the following do not ensure firm viability over the long run?

Reviewing Financial Statements

Analyzing Financial Statements

Time Value of Money 1: Analyzing Single Cash Flows

Time Value of Money 2: Analyzing Annuity Cash Flows

Understanding Financial Markets and Institutions

Valuing Bonds

Valuing Stocks

Characterizing Risk and Return

Estimating Risk and Return

Calculating the Cost of Capital

Estimating Cash Flows on Capital Budgeting Projects

Weighing Net Present Value and Other Capital Budgeting Criteria

Working Capital Management and Policies

Filters